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Government Main Barrier To Solar Investment

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Published: Tuesday, 21 February 2017 10:17

Although demand is high, local authorities across the UK are having their hands tied by reduced government incentives, a Freedom of Information request from the electronic and solar specialist, LG Electronics has revealed.

This is against a backdrop of slowing growth in solar deployment across the UK, despite the cost of solar panels dropping to an all-time low. According to government figures*, solar installation growth has reduced from 43% in 2015 to 21% in 2016.

Nearly half (47%) of local authorities said that reduced government incentives over the last few years has been the main barrier to solar investment. The next most citied reason was the lack of capital to front investment (23%), followed by a lack of internal stakeholder buy in (6%).

Looking ahead, a concerning majority (71%) of local authorities have no strategy or plan towards solar investment whatsoever. These councils do not have solar technology incorporated within their current environmental strategy and have no specific targets or direction towards to a solar deployment.

Additionally, most local authorities (70%) have no plans to add to their solar capacity for the next five years. In the next six months, only 19% of local authorities plan to invest, while 76% are not investing in solar.

Demand for solar power is clear, with 84% of local authorities owning solar panels. However, the research shows that government cuts have had a severe and long-lasting impact on the future deployment of solar power across the public sector. Several local authorities, including Swindon, Cambridge, Barnsley and Hounslow have proved solar projects can be successful. In 2016, Hounslow Council completed a solar installation project on the roof of Western International Market - in the first year alone, the project is expected to reduce carbon emissions by 50% and earning the council £255,000 each year.

Bob Mills, UK Senior Sales Manager, LG Electronics said, “Local solar projects have been remarkably successful – saving money and benefitting the wider community. In today’s energy market, a 14% commercial return on solar technology is consistently met and therefore represents a no-brainer for public sector decision-makers. These projects can also set the wheels in motion for future investment in renewables and renewable technology. To find out that lack of government support is the main barrier to further investment, is deeply saddening. Our research has revealed that the Government’s policy towards solar is ineffective and in some cases, completely non-existent. Until there is a clarity on solar strategy, we will continue to see public money wasted on out-dated and overpriced energy projects.”

Charles Pipe, Energy Manager at London Borough of Hounslow stated, “While the Government’s dramatic cuts will impact solar deployment, there are still options available to local authorities. All energy installations must meet specific criteria and have as close to a seven-year payback as possible. Solar can meet this and more – offering immediate savings and the potential for more in the future. For our project at Hounslow, we expect to make several million in the next 20 years. It can and does work, councils simply need to understand that solar investment is no longer a risk.”

*National Statistics ‘Solar photovoltaics deployment’ report

MethodologyThe findings used in this press release are taken from a Freedom of Information Act request of all local authorities in the UK in December of 2016, to which 332 responded.